In a private phone call late Wednesday morning, CEOs who were part of a strategic council to Trump agreed to disband the group and condemn Trump's confrontational response to a violent white supremacist rally in Charlottesville, Virginia.

"There really was nothing to debate," said one member of the Strategic and Policy Forum who described the president's fiery Tuesday news conference as a "tripwire."

The events mark the biggest falling out yet between Trump and corporate America, which largely cheered his pro-business stances when he took office.

Andrew Harrer | Bloomberg | Getty Images

President Donald Trump walks towards the White House on the South Lawn after disembarking Marine One in Washington, D.C., U.S., on Monday, Aug. 14, 2017.

Business leaders heard from employees and customers about their roles on the council. Some council members started to discuss how to react to Trump's comments over the weekend, even before he doubled down on blaming both sides of the deadly protests in his chaotic Tuesday news conference.

Trump's public chiding of Merck CEO Ken Frazier — the first person to leave the manufacturing council on Monday — also influenced the decision.

Their decision was not unanimous, initially. The strategic council's leader, Blackstone CEO Steve Schwarzman, seemed reluctant at first to disband the group. He changed his mind on Tuesday, CNBC has learned.

Former General Electric CEO Jack Welch was also skeptical at first about ending the forum.

In a statement, the Strategic and Policy Forum members said they "believe the debate over Forum participation has become a distraction from our well-intentioned and sincere desire to aid vital policy discussions on how to improve the lives of everyday Americans."

Corporate leaders and notable Republicans distanced themselves from Trump this week because of his response to last weekend's violence. A car allegedly driven by a suspected white nationalist rammed into counterprotesters, killing one woman and injuring 19 others.

"The thinking was it was important to do as a group," said the member of the advisory council. "As a panel, not as individuals because it would have more significant impact. It makes a central point that it's not going to go forward. It's done."

In a statement, Dimon said, "Constructive economic and regulatory policies are not enough and will not matter if we do not address the divisions in our country."

"It's a leader's role, in business or government, to bring people together, not tear them apart," Dimon said.

In an internal memo obtained by CNBC, IBM's Rometty condemned the "hate groups in Charlottesville" and said the policy forum "can no longer serve the purpose for which it was formed."

Just Tuesday, Trump tweeted that he has "many" executives to take the place of the CEOs who step down from his business councils. "Grandstanders should not have gone on," he added.